58. A buyer is looking in several different cities for land to purchase for a shopping center. The buyer has decided to hire several real estate licensees, each representing the buyer in that licensee's city. Which of the following types of agreements would most likely protect the buyer from owing multiple commissions?
Answer: C
Nonexclusive buyer-agency agreements would likely protect the buyer from owing multiple commissions.
A nonexclusive buyer-agency agreement allows the buyer to work with multiple real estate licensees without the obligation to pay multiple commissions, as each agent is aware that they are not the sole representative.
A) exclusive agency representation
Exclusive agency representation would not protect the buyer from owing multiple commissions, as this type of agreement typically grants one agent the right to earn a commission, while others are excluded. This could lead to complications if the buyer engages multiple agents, as the single agent could claim the commission regardless of the buyer’s multiple engagements.
B) nonexclusive right-to-lease
A nonexclusive right-to-lease agreement pertains specifically to leasing property rather than purchasing it. Therefore, it does not address the buyer’s scenario of purchasing land for a shopping center, making it an inappropriate choice for the situation described.
C) nonexclusive buyer-agency
Nonexclusive buyer-agency is the correct choice because it allows the buyer to work with several agents in different cities without the risk of incurring multiple commissions. Each agent understands that they are competing for the buyer’s business, which eliminates the obligation for the buyer to pay commissions to multiple agents.
D) exclusive right to sell
An exclusive right to sell agreement would give one agent the sole right to sell the property and earn a commission, which can lead to the buyer being obligated to pay that agent even if they find the property themselves or engage others. This option does not align with the buyer's intention to hire multiple agents in different locations.
Conclusion
The nonexclusive buyer-agency agreement is the most suitable option for the buyer, as it allows flexibility in engaging multiple agents without the risk of multiple commission liabilities. The other options either limit the buyer's ability to engage multiple agents or are not relevant to the purchase scenario, making them unsuitable for this situation.